Council OKs tax break for housing, retail

Published: November 15, 2013 | Last Modified: April 24, 2014 11:45AM

By Dan Brechlin
Record-Journal staff

MERIDEN — The City Council approved a tax abatement for a possible future development on Colony Street being proposed by the Meriden Housing Authority and Westmount Development Group. The proposal is to construct a 63-unit building with retail space. The approval should allow the partnership to apply for the tax credit funding today, prior to the Monday deadline.

The public-private partnership has proposed a four-story, mixed-use building at the corner of Colony and Church streets and is applying for a tax credit program through the Connecticut Housing and Finance Authority, which would allow for the majority of funding for the project. The council voted by a 7-2 margin in favor of the negotiated 15-year tax abatement, which will relieve the owners of 80 percent of the taxes.

Of the 63 units, 24 will be replacement units for residents at Mills Memorial Apartments. Residents living in two of the low-rise buildings will be given vouchers to be among the first to live in the new building. An additional 32 units will be affordable, or workforce, housing, meaning that there would be a mix of incomes. The remainder would be market-rate housing. Nearly all would be one- or two-bedroom units.

City Manager Lawrence J. Kendzior spoke at length about the development and noted that there are misconceptions about workforce housing and the development. Among them, he said, is that the potential tenants would not have enough disposable income and would essentially be the same residents from the Mills. Kendzior, however, noted that firefighters and teachers early in their careers would qualify for the housing.

“I would not believe anyone on this council would say that we shouldn’t give this type of housing opportunity, a good, beautiful housing opportunity, to, for example, a first- or second-year firefighter employed by the city of Meriden. Or a teacher of one to three years,” Kendzior said. “They are income eligible. People with an income up to $42,000 qualify to live in these workforce housing units.”

Kendzior went on to explain that about $115,000 of tax revenue is expected to be raised each year by the building and the parking garage that would be constructed in the rear of the development by the state Department of Transportation. While the full value would be higher, Kendzior acknowledged that there have not been interested parties and without the abatement, the development would not be constructed.

“It’s not a question between $115,000 and $190,000 and the full value, it’s a question of $115,000 and zero,” Kendzior explained, noting if there are excess profits from what is expected, they will be shared equally.

Though much of the council was in support, council Minority Leader Dan Brunet had concerns about the length of the abatement and the potential to gain additional revenue.

“This is a company with a track record for success ... they can afford another $100,000 per year,” Brunet said, to which councilor Walter A. Shamock Jr. agreed, also voting against the resolution.

Kendzior explained the 15-year abatement is a requirement that is mandated and the Westmount-MHA partnership had originally requested a 35-year abatement. Kendzior agreed that 15 years seemed excessive, but without the required abatement, there would be no project.

Kendzior also answered the concerns of multiple city residents, including David Swedock, Roxanne Macri, Arline Dunlop, and mayor-elect Manny Santos. Santos commended those who have worked on the project, but said he was concerned about the relocated low-income units, not enough affordable housing units and issues with public safety in the garage.

“Downtown is struggling; we need taxpayers with disposable income who can come and shop and spend money in downtown,” he said.

Cornelius J. Ivers, the chairman of the MHA Board of Commissioners, spoke in favor of the development, saying it has the potential to change the city.

“If we don’t do the project, the DOT is going to come in and give you a flat parking lot,” Ivers said. “You say you want private development, well, so we would. We’ve been waiting about 40 years. ... This is going to replace what has been a hole in downtown for many years.”